Wesfarmers investors veto chief's pay rise

DISGRUNTLED Wesfarmers shareholders have had a symbolic win by narrowly rejecting a remuneration report that includes a $450,000 pay increase for the chief executive, Richard Goyder.

However, the vote is non-binding, meaning the conglomerate is not obliged to take notice of the objections although the new chairman, Bob Every, said it was a message the company would consider seriously.

The voting results, from Wesfarmers' annual general meeting in Perth on Thursday, were revealed yesterday and showed 151.36 million votes against the resolution compared with 146.23 million in favour.

"As the new chair of the board's REM [remuneration] committee, I'll make sure these issues are carefully considered," Mr Every said. "I'm not committing either the committee or the board to major changes at this stage until we've had time to properly consider the issues.

"The remuneration structures which received a negative vote were the result of a major REM view by the board that was necessary due to the changes to the company that resulted from the Coles acquisition.

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"These changes were agreed to [by] the board because it genuinely believed they were in the interests of long-term shareholder value creation.

"I am conscious that the REM structures … are very complex because we have merged old and new remuneration schemes, and had to report on both.

"My first priority will be to reduce its complexity so people understand more clearly what we're trying to achieve, and how we're going about it."

During question time at Thursday's meeting, shareholders slammed the retail and resources giant for giving its executives large remuneration packages in the midst of the global financial meltdown.

The report showed Mr Goyder's cash salary this year was $2.73 million, up from $2.28 million last year. It also showed that Mr Goyder would receive 200,000 free shares if the company met certain performance targets that have not been revealed.

"I understand that in the current market, there is significant angst across the board about remuneration," Mr Every said.

"But like any board, we need to remain focused beyond the short term and continue to make decisions we think are in the longer-term interests of our shareholders, particularly on remuneration."

Mr Every replaces Trevor Eastwood, who retired after the meeting, after more than 45 years with the company. Wesfarmers shares closed down 26c, or 1.4 per cent at $17.80.